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Branch Management

Where does the Universal Banker model fit with your branch staffing?

 

With customer channel preferences changing and branch transactions declining, most bank branches are staffed with more personnel – and often different types of staff — than ideally needed.

 

Institutions that have successfully implemented this model have realized increased sales, lower staffing costs, and greater staff retention.

 

In this 4 minute video, Ric Carey, who has had extensive experience in implementing and managing the Universal Bankers, discusses best practices and practical implementation tips.

 

 

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Q: “Is there an ideal branch format?”

 

A: The “ideal branch” of the future will be fully automated with robots or holograms serving as branch staff. The interior walls will reconfigure at the push of a button to create meeting rooms of different sizes and shapes with chairs popping out of the floor to fit any configuration. Branch signage along with interior finishes (wall colors, floor coverings, artwork, etc.) will be all digital. They will change remotely if the bank merges with a competitor. Customers will self-identify through retina scans or facial recognition. The facilities will be fully paperless, green and LEED-certified.

 

OK; maybe that’s a 25th Century blueprint.

 

In many of my recent engagements I’ve been asked that very question: “Is there an ideal branch format?” In whatever bank publication you pick up today, it seems someone has an opinion on the one ideal branch design. It’s smaller, heavily automated and uses digital signage. But …

 

I don’t believe in just one ideal branch design just as I don’t think there is one ideal car design.  The real answer is: “It depends … on lots of things.”

 

For starters, foot traffic and available real estate dictate branch size. For banks with very busy branches—say, 10,000 teller transactions—you can’t comfortably squeeze what you need into a 2,000-square ft. space. And in some markets, the best available site might measure 3,500 square ft. when you only need 2,500. It might be impossible to subdivide it.

 

I think “ideal” designs likely change depending on situations. Let me describe one superior design that works with small-to-midsize community banks and credit unions, especially in smaller markets and more rural areas. These firms are more likely to have less foot traffic for teller transactions, and therefore sales opportunities. However, they likely have a large enough customer base to drive a steady volume of customer account servicing issues.

 

There are seven key elements:

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If the podcast does not appear, please click on the word “Podcast” in the title of this article) 

 

On this episode of the BAI Banking Strategies podcast, Lou Carlozo, Managing Editor, interviews   Jon Voorhees of Peak Performance Group about the closing, opening and evolution of bank branches. Voorhees also reveals how banks can close branches and still experience low customer attrition rates.

 

Lou Carlozo, BAI. Bank branches. Where the three key words before were always location, location, location – today they might as well be decisions, decisions, decisions.  Should branches be closed, should they be transformed, should they be re imagined. or should branches turn into something altogether different that uses the best world of customer satisfaction and automation.

 

To learn more about the current and future state of branches we will be talking with bank branch expert Jon Voorhees.

 

Welcome to BAI Banking Strategies, where each week we will focus on key issues facing financial services leaders.  We’ll bring you objective opinions and actionable insights that will help you power smart decisions. I’m your host, Lou Carlozo, Managing Editor of BAI. Come on in!

 

Thanks for tuning in. It is great to have you on the podcast today and we are at the end of Season 2 so we want to thank everyone who has tuned in so far. While we’re off you can check out the archive of podcasts at www.bai.org  and as always, our podcasts can be heard through Apple iTunes podcast app, Soundcloud and Google Play.

 

And today with us here we have Jon Voorhees, a Consultant/Adviser for Peak Performance Consulting Group. Most recently focused on the consumer banking industry, Jon has used his expertise in retailing, consumer goods and the automotive industry.  If you’ve read his posts on BAI Banking Strategies you know he is clear spoken and gets right to the heart of things.

 

Jon, great to have you on the program today.

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John Voorhees, consultant and advisor at Peak Performance Consulting Group, was one of seven experts asked to share their vision of what bank branches will look like in the future in this Banking Strategies article and as part of the Executive Report on the Evolution of the Branch.

 

Speaking specifically about how customers will be assigned, John states “The platform will consist of even more specialists, and platform bankers may be assigned a portfolio of customers when issues need to be resolved—think of the olden days when you could go see ‘your banker.’ Customers may be able to communicate with branch personnel via Skype and more banks will also have private soundproof rooms in which customers can have face-to-face conversations with offsite bank specialists via video-conferencing.”

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For years the industry’s eyes were on Wells Fargo as a cross-selling winner. That reputation went down in flames with last year’s sales scandal. But banking’s eyes continue to scan Wells, which recently introduced a revamped performance management and rewards program that the bank’s leadership described as a beginning, subject to revision based on ongoing experience.

 

“The devil is in the details,” and the potential improvement lies in careful monitoring were points of agreement among experts interviewed by Banking Exchange  who looked at the summary released by the bank earlier in January.

 

“It’s a very positive step,” says David Kerstein, president of Peak Performance Consulting Group. “I’m pleasantly surprised that they have taken such aggressive steps. I think this is the right way to go for the industry, not just for Wells Fargo.”

 

He says it would be essential to use such tools as mystery shopping to have an independent view of how well the program works where customer meets banker.

 

“You have to be sure that you are building customer relationships and doing the right thing,” says Kerstein. “Wells had lost sight of the overall customer,” he adds, in its earlier emphasis on cross-selling. If the bank can make the team dynamic work and produce the longer-term results it hopes for, that will be a very positive development, he says.

 

Further, if employees can truly work as a team, and the incentives pay off in that context, “turnover may be reduced,” Kerstein adds.

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This article by Peak Performance consultant Jon Voorhees was originally published in BAI Banking Strategies on October 10, 2016.  Voorhees is former head of distribution strategy and execution at Bank of America Corp.  

 

It seems like every week you hear about another bank’s plans to close some large number of branches. Some analysts predict (though I don’t agree) that half of all branches open today will close in the next few decades as online and mobile banking fully takes hold with consumers and small businesses.

 

Due to today’s very low interest rate environment, margins have been squeezed for several years.  Banks have felt unrelenting pressure to cut expenses. And branch closures represent a natural target because customers have migrated many of their transactions to the newer, more flexible e-channels rolled out over the last ten years. There are even seemingly ubiquitous phrases that CEOs and CFOs trot out when announcing closures. Like these:

 

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